We improve SSA programs and operations and protect them against fraud, waste,
and abuse by conducting independent and objective audits, evaluations, and investigations.
We provide timely, useful, and reliable information and advice to Administration
officials, the Congress, and the public.

Authority

The Inspector General Act created independent audit and investigative units,
called the Office of Inspector General (OIG). The mission of the OIG, as spelled
out in the Act, is to:

Conduct and supervise independent and objective audits and investigations
relating to agency programs and operations.
Promote economy, effectiveness, and efficiency within the agency.
Prevent and detect fraud, waste, and abuse in agency programs and operations.
Review and make recommendations regarding existing and proposed legislation
and regulations relating to agency programs and operations.
Keep the agency head and the Congress fully and currently informed of problems
in agency programs and operations.

To ensure objectivity, the IG Act empowers the IG with:

Independence to determine what reviews to perform.
Access to all information necessary for the reviews.
Authority to publish findings and recommendations based on the reviews.

Vision

By conducting independent and objective audits, investigations, and evaluations,
we are agents of positive change striving for continuous improvement in the
Social Security Administration's programs, operations, and management and in
our own office.

Our objective was to determine whether individuals who received multiple auxiliary
or survivor benefits were entitled to the benefits paid to them.

BACKGROUND

Eligible spouses and children of retired or disabled workers may be paid auxiliary
benefits under Title II of the Social Security Act. In addition, benefits may
also be payable to certain survivors of deceased workers. The number of beneficiaries
and total monthly benefits paid in December 2003 are shown in the table below.

Individuals may be entitled to auxiliary/survivor benefits based on several
workers' earnings simultaneously (for example, based on the earnings of both
parents), but may generally only be paid on the higher of the two. When an auxiliary/survivor
beneficiary becomes entitled to another, higher benefit, the Social Security
Administration's (SSA) policy is to stop issuing the lower benefit payments,
thus preventing an overpayment from occurring.

SSA uses its Master File Duplicate Detection Operation (MAFDUP) software to
identify beneficiaries who may be incorrectly receiving benefits on multiple
records. The Agency runs MAFDUP twice annually (March and September) and alerts
are generated to SSA's Program Service Centers for review and action. To assist
the Agency with tracking overpayments established as a result of MAFDUP, all
overpayments posted to benefit records must be coded as "multiple entitlement."

In February 2004-while conducting an audit on childhood disability benefits
-we identified a population of 1,514 beneficiaries whose Social Security numbers
(SSN) were recorded on multiple records and, therefore, appeared to be incorrectly
receiving multiple auxiliary/survivor benefits. We randomly selected 200 of
the 1,514 beneficiaries for review to determine whether payments to these beneficiaries
were appropriate. (For additional information about our scope, methodology and
sampling results, see Appendix B.)

RESULTS OF REVIEW

Generally, individuals who received multiple auxiliary/survivor benefits were
not entitled to the benefits paid to them. Based on the results of our sample,
we estimate that about 863 beneficiaries were incorrectly paid approximately
$3.5 million in benefits under multiple records. Although we estimate the Agency
identified about $1.5 million of these overpayments, we estimate about $2.0
million went undetected by the Agency. Further, because of our audit, we estimate
SSA avoided paying about $614,336 by stopping some of the incorrect payments
sooner than it would have through its existing procedures.

Of the 200 cases we sampled:

114 beneficiaries were overpaid $462,713 because they incorrectly received
benefits under multiple records simultaneously;

42 beneficiaries were still being reviewed by the Agency;

33 beneficiaries stopped receiving incorrect payments, but SSA did not record
any overpayments; and

11 beneficiaries did not receive multiple benefits simultaneously, but their
SSNs were incorrectly recorded on SSA's systems.

Although these individuals did not receive multiple benefits, SSA's ability
to ensure payment accuracy is impacted when auxiliary/survivor beneficiaries'
SSNs are not recorded correctly on their benefit records.

BENEFICIARIES OVERPAID MULTIPLE AUXILIARY/SURVIVOR BENEFITS

Of the 200 beneficiaries in our sample, 114 were incorrectly paid benefits
under multiple records. The Agency detected $198,074 in overpayments to 39 of
these beneficiaries (34 percent). However, $264,639 in overpayments to the remaining
75 beneficiaries (66 percent) went undetected by the Agency. Below are two examples.

One beneficiary began receiving multiple benefits in September 2002. SSA detected
the error and took corrective action in April 2004. As a result, ongoing incorrect
payments were stopped and the Agency began efforts to recover the $5,938 that
was incorrectly paid to the beneficiary.

In November 2002, the Agency began issuing new benefits to a beneficiary without
stopping the other, smaller benefit payment. In December 2004, the Agency took
corrective action based on our audit and began efforts to recover the $4,718
incorrectly paid to this beneficiary.

MAFDUP RESULTS

Although SSA uses MAFDUP to detect situations involving multiple benefits,
we found that not all beneficiaries who were incorrectly paid multiple benefits
were identified by the software. Of the 114 overpaid beneficiaries in our sample,
90 (79 percent) were identified by MAFDUP, but 24 were not (21 percent). These
24 beneficiaries were not identified by MAFDUP even though their SSNs appeared
on multiple records.

For example, SSA began issuing new benefit payments to one beneficiary in June
2002 without also stopping the other benefits that were already being paid.
Although the beneficiary's SSN appeared on both benefit records, the software
did not identify the multiple payments that were issued. Consequently, SSA personnel
were unaware that payments totaling $10,336 were incorrectly issued until our
audit. Based on our review, the Agency took corrective action in July 2004 and
began efforts to recover the overpayment.

Overpayments can accumulate when alerts are not worked timely. Although 90
of the overpayment cases were identified by MAFDUP, 53 of them were not corrected
until our audit. For example, one beneficiary-whose multiple benefits were identified
by MAFDUP-was overpaid $6,813 from November 2002 through May 2004. In May 2004,
SSA stopped the ongoing incorrect payments based on our audit. If the earlier
alerts produced by MAFDUP had been investigated timely, a significant portion
of the overpayment could have been prevented.

SSA runs MAFDUP twice annually (March and September). Therefore, the opportunity
exists for overpayments to be larger and span longer periods of time than they
otherwise would be if they were detected and resolved sooner. For example, one
beneficiary began receiving multiple benefits in October 2003 (one month after
MAFDUP was last run). The incorrect payments went undetected for several months
(and overpayments continued to accumulate) until MAFDUP was run again in March
2004. The Agency took corrective action in April 2004 to stop the payments and
recover the $2,054 that was incorrectly paid to the beneficiary. If SSA were
to run MAFDUP more frequently (e.g., monthly), individuals receiving multiple
benefits could be identified sooner and overpayments could be avoided.

To assist the Agency with tracking the results of MAFDUP, SSA captures the
overpayments recorded on the beneficiaries' records subsequent to the alerts,
provided the overpayment reasons are shown as resulting from "multiple
entitlement." Agency personnel correctly recorded the overpayment reasons
for 77 of the 114 overpaid beneficiaries (68 percent). However, for the remaining
37 beneficiaries (32 percent), the overpayments were not recorded as resulting
from "multiple entitlement." As a result, the value of the Agency's
MAFDUP software-as expressed in terms of overpayments identified-may have been
understated.

ACCURACY OF OVERPAYMENTS RECORDED

In addition to analyzing the 200 cases in our sample, we confirmed the accuracy
of overpayments recorded for 68 of the 1,514 beneficiaries in our audit population.
We found that Agency personnel did not accurately calculate and record overpayments
for all beneficiaries who were incorrectly paid multiple auxiliary/survivor
benefits. Overpayments resulting from multiple benefits must be manually computed
and recorded and, therefore, are error prone. We requested that SSA review the
68 records to determine whether the individuals were overpaid and, if so, whether
the overpayments were calculated and recorded accurately.

The Agency confirmed that the overpayments recorded for 32 of these 68 beneficiaries
were not correct (47 percent). SSA originally calculated and recorded overpayments
totaling $17,789. However, after reviewing these records based on our audit,
the Agency determined that an additional $65,528 was overpaid, but was not previously
recorded. Of these 32 beneficiaries:

24 did not have any overpayments recorded prior to our audit, even though they
were overpaid a total of $56,704.

8 were not assessed the correct overpayment amounts prior to our audit. Specifically,
SSA only recorded $17,789 of the $26,613 in overpayments (67 percent) they actually
received. Based on our audit, the Agency assessed an additional $8,824 in overpayments.

CONCLUSIONS AND RECOMMENDATIONS

Generally, individuals who received multiple auxiliary/survivor benefits were
not entitled to the benefits paid to them. Although the 1,514 beneficiaries
in our audit population represent less than 1 percent of all auxiliary/survivor
beneficiaries, we estimate that about $3.5 million was improperly paid to these
individuals and could have been avoided. To assist the Agency in achieving its
strategic objective of preventing improper payments and improving debt management,
we recommend that SSA:

1. Remind employees to take the necessary action to stop any benefits being
paid when beneficiaries become entitled to other, higher benefits.

2. Review MAFDUP procedures (and modify if necessary) to ensure all beneficiaries
who appear to have incorrectly received multiple benefits are identified and
alerted.

3. Run MAFDUP more frequently to minimize the amount of overpayments that accumulate.

4. Review the records in which the auxiliary/survivor beneficiaries continued
to receive benefits as of December 2004 and take action to: (a) stop any recurring
incorrect payments and recover any overpayments, or (b) correct the SSNs for
those beneficiaries whose SSNs were incorrectly recorded.

6. Review the overpayments to those beneficiaries who incorrectly received
multiple benefits to ensure they were calculated and recorded correctly.

AGENCY COMMENTS

The Agency agreed with five of our six recommendations. Specifically, the Agency
plans to (a) issue reminder instructions to employees in March 2005, and (b)
review the records and overpayments for the cases specified in our audit to
ensure they were processed correctly. SSA also indicated that several improvements
were recently made to MAFDUP that should help the Agency better identify multiple
payment situations; and the Agency is considering additional systems enhancements.
However, SSA acknowledged that such enhancements must first be reviewed and
prioritized against other systems improvements before they can be developed
and implemented.

In response to recommendation 3, SSA did not agree to run MAFDUP more frequently
because the Agency believes that, if further systems modifications are approved
and funded, there would be no need for additional MAFDUP runs.

OIG RESPONSE

We are encouraged by the Agency's plans to enhance its computer systems to
better identify and prevent multiple benefits to auxiliary/survivor beneficiaries.
We agree that SSA's planned improvements to MAFDUP should decrease the improper
payments described in our report. However, the additional systems enhancements
the Agency has planned will take time to implement. Until these systems enhancements
are in place, we encourage SSA to run MAFDUP more frequently so that multiple
benefit cases may be identified sooner and overpayments may be avoided.

Appendix A
Acronyms
MAFDUP Master File Duplicate Detection Operation
OIG Office of the Inspector General
SSA Social Security Administration
SSN Social Security Number
U.S.C. United States Code

Appendix B
Scope, Methodology and Sample Results

In October 2003, we identified a population of 160 individuals who appeared
to have incorrectly received multiple childhood disability benefits (i.e., the
same Social Security numbers appeared on multiple benefit records). During the
course of this audit, we obtained a file from the Social Security Administration
(SSA) of all Title II beneficiaries who were receiving benefits as of February
2004. From this file, we identified a separate population of 1,514 individuals
who appeared to be receiving multiple auxiliary/survivor benefits inappropriately.
Therefore, we initiated this review to determine whether payments to these 1,514
beneficiaries were appropriate.

To accomplish our objective, we researched the Social Security Act and SSA's
regulations, policies and procedures related to multiple auxiliary/survivor
benefits. We referred the 1,514 cases to SSA's Office of Operations for review
and corrective action. We randomly selected 200 of the 1,514 cases and analyzed
beneficiary information available on SSA's electronic systems-including the
Master Beneficiary Record and the Payment History Update System-and projected
our results to the population. In addition, we selected 68 of the 1,514 cases
and confirmed with SSA whether the overpayments resulting from multiple benefits
were calculated and recorded correctly.

For records that were corrected by SSA as a result of our audit, we estimated
the benefits the Agency avoided paying by stopping the incorrect payments. Specifically,
we found that the median overpayment period-resulting from incorrect payments
that SSA detected through its existing procedures-was 15 months. Therefore,
for cases in which the Agency stopped the incorrect payments sooner than 15
months based on our audit, we assumed that SSA avoided paying some monthly benefits.

We conducted our review between May and December 2004 in Boston, Massachusetts.
We determined that the data used for this audit was sufficiently reliable to
meet our audit objective. The principal entities audited were SSA's Field Offices
and Program Service Centers under the Deputy Commissioner for Operations. We
conducted our audit in accordance with generally accepted government auditing
standards.

We appreciate OIG's efforts in conducting this review. Our comments on the
draft report recommendations are attached.

Please let me know if you have any questions. Staff inquiries may be directed
to
Candace Skurnik, Director, Audit Management and Liaison Staff, at extension
54636.

Attachment:
SSA Response

COMMENTS ON THE OFFICE OF THE INSPECTOR GENERAL (OIG) DRAFT REPORT, "REVIEW
OF INDIVIDUALS RECEIVING MULTIPLE AUXILIARY OR SURVIVORS BENEFITS" (A-01-05-25015)

Thank you for the opportunity to review and comment on the draft report. Our
responses to the specific recommendations are provided below.

Recommendation 1

The Social Security Administration (SSA) should remind employees to take the
necessary action to stop any benefits being paid when beneficiaries become entitled
to other, higher benefits.

Response

We agree. We will issue a reminder in March 2005.

Recommendation 2

SSA should review Master File Duplicate Detection Operation (MAFDUP) procedures
(and modify if necessary) to ensure all beneficiaries who appear to have incorrectly
received multiple benefits are identified and alerted.

Response

We agree. This finding was based on data from February 2004. Since then, we
have made enhancements in MAFDUP to improve the identification process. As part
of
Title II Redesign Release 3, changes were made to clearly define some Master
Beneficiary Record (MBR) data elements. MAFDUP was revised to look at the correct
MBR tags when comparing Health and Medical Insurance data on both Social Security
numbers. These enhancements should help improve the identification process.
Also, in September 2004, MAFDUP was revised to generate a Category 1 (high priority)
follow-up alert to the field when the initial alert is not worked.

As part of our ongoing efforts to enhance payment accuracy, we will consider
additional enhancements that may include:

Adding a modification to the Modernized Claims System (MCS) that would produce
a processing limitation, instead of an alert, when an auxiliary beneficiary
is incorrectly receiving benefits on another record, thus avoiding overpayments
on the front end; and

Adding other data criteria such as the Beneficiaries Own Account Number to improve
the selection process.

However, additional systems modifications would require prioritized approval
and funding from the Information Technology Advisory Board prior to implementation.

Recommendation 3
SSA should run MAFDUP more frequently to minimize the amount of overpayments
that accumulate.

Response

We disagree. We do not believe that running MAFDUP more frequently would assist
in minimizing the amount of overpayments that accumulate. We agree that action
is necessary to minimize the occurrence and amount of overpayments, and as noted
in Recommendation 2, we have made enhancements in MAFDUP to improve the identification
process. If the MCS modification, as outlined in the first bullet of Recommendation
2 (i.e., initiating a processing limitation as opposed to an alert), is approved
and funded, there would be no need for additional MAFDUP runs.

Recommendation 4
SSA should review the records in which the auxiliary/survivor beneficiaries
continued to receive benefits as of December 2004 and take action to: (a) stop
any recurring incorrect payments and recover any overpayments, or (b) correct
the SSNs for those beneficiaries whose SSNs were incorrectly recorded.

Response

We agree. Once we receive the information from OIG, we will process the accounts
that are still in current pay.

Recommendation 5
SSA should remind employees of the proper procedures for manually calculating
and recording overpayments resulting from multiple benefits.

Response

We agree. We will issue a reminder in March 2005.

Recommendation 6
SSA should review the overpayments to those beneficiaries who incorrectly received
multiple benefits to ensure they were calculated and recorded correctly.

Response

We agree. We will review the 147 cases identified in this review with beneficiaries
who incorrectly received multiple benefits to ensure that the overpayments were
calculated and recorded correctly. We are concerned about the accuracy of our
payment-related determinations and once we receive the information from OIG,
we will review the accounts for proper disposition.

For additional copies of this report, please visit our web site at www.socialsecurity.gov/oig
or contact the Office of the Inspector General's Public Affairs Specialist at
(410) 965-3218. Refer to Common Identification Number
A-01-05-25015.

Overview of the Office of the Inspector General

The Office of the Inspector General (OIG) is comprised of our Office of Investigations
(OI), Office of Audit (OA), Office of the Chief Counsel to the Inspector General
(OCCIG), and Office of Executive Operations (OEO). To ensure compliance with
policies and procedures, internal controls, and professional standards, we also
have a comprehensive Professional Responsibility and Quality Assurance program.

Office of Audit

OA conducts and/or supervises financial and performance audits of the Social
Security Administration's (SSA) programs and operations and makes recommendations
to ensure program objectives are achieved effectively and efficiently. Financial
audits assess whether SSA's financial statements fairly present SSA's financial
position, results of operations, and cash flow. Performance audits review the
economy, efficiency, and effectiveness of SSA's programs and operations. OA
also conducts short-term management and program evaluations and projects on
issues of concern to SSA, Congress, and the general public.

Office of Investigations

OI conducts and coordinates investigative activity related to fraud, waste,
abuse, and mismanagement in SSA programs and operations. This includes wrongdoing
by applicants, beneficiaries, contractors, third parties, or SSA employees performing
their official duties. This office serves as OIG liaison to the Department of
Justice on all matters relating to the investigations of SSA programs and personnel.
OI also conducts joint investigations with other Federal, State, and local law
enforcement agencies.

Office of the Chief Counsel to the Inspector General

OCCIG provides independent legal advice and counsel to the IG on various matters,
including statutes, regulations, legislation, and policy directives. OCCIG also
advises the IG on investigative procedures and techniques, as well as on legal
implications and conclusions to be drawn from audit and investigative material.
Finally, OCCIG administers the Civil Monetary Penalty program.

Office of Executive Operations

OEO supports OIG by providing information resource management and systems security.
OEO also coordinates OIG's budget, procurement, telecommunications, facilities,
and human resources. In addition, OEO is the focal point for OIG's strategic
planning function and the development and implementation of performance measures
required by the Government Performance and Results Act of 1993.